Centamin posts record output at Sukari mine

DESPITE a temporary closure of the Sukari mine last month, Egyptian miner Centamin yesterday said output at its flagship asset jumped to a record high in the final quarter of last year.

The FTSE 250 miner said that total gold production over the three months to December hit a record 85,543 ounces, a 45 per cent increase from the same period last year and a 40 per cent increase from the third quarter.

Head of business development Andy Davidson told City A.M. that a key driver behind the jump was the improving grade of gold mined.

The gold miner was forced to suspend operations at Sukari for around 10 days in December following a dispute over diesel supplies and gold exports, causing its shares to shed almost half their value.

Gold exports, which were halted by customs officials, have resumed slowly, and Centamin said yesterday it expected that regular gold exports will continue “as and when required”.

Shrugging off the closure of Sukari, chairman Josef El-Raghy said that the company was looking forward to a further increase in production growth this year.

While analysts welcomed the positive results, many were circumspect about Centamin’s fortunes in 2013.

“We expect the shares to react strongly, although the cloud of political and corporate issues are likely to continue to dog the stock for a while yet,” said mining analyst Cailey Barker at Numis.

“After such a difficult year, to achieve its production forecast for the first time is an excellent result,” added Craig Foggo from RFC Ambrian. “However, we still await to see what surprises 2013 has in store for Centamin.”

The market responded well yesterday, and Centamin moved to claw back some of its losses felt in December, with shares closing up 12.61 per cent at 49.98p.